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Steel and aluminum tariffs for Canada, Mexico and European Union delayed

May 3, 2018

Tariffs on steel and aluminum imports from Canada, Mexico and the European Union were postponed by President Trump moments before they were to go into effect on May 1.

The White House said it reached agreements on metals imports with Argentina, Australia and Brazil, saying more details will be finalized in 30 days.

Trump has put off a decision on steel and aluminum tariffs aimed at Mexico and Canada because he is trying to gain more access for U.S. businesses to their markets as part of a North American Free Trade Agreement renegotiation, the Washington Post reported.

The announcement to postpone the tariffs is the latest unexpected directive in Trump’s four-month effort to change the United States’ trade relationship with more than a dozen countries. Some countries have received preferential treatment by agreeing to early changes, such as South Korea. Others, such as Japan, have been rebuffed despite repeated overtures from their leaders.

The administration has reached agreements in principle on the metals trade with Argentina, Australia and Brazil and is extending negotiations with Canada, Mexico and the European Union for a final 30 days, a modest reprieve.

The metals negotiations have been a key test of Trump’s trade strategy and diplomacy, pitting his highly personal bargaining style against the determination of major U.S. trade partners and allies to hold fast and retaliate if necessary under World Trade Organization rules.

A high-powered delegation was to go to Beijing to hold talks on trade May 3, the White House announced. The group will include Treasury Secretary Steven Mnuchin, Commerce Secretary Wilbur Ross, U.S. Trade Representative Robert E. Lighthizer, National Economic Council head Larry Kudlow and Peter Navarro, assistant to the president for trade and manufacturing policy. Terry Branstad, the U.S. ambassador to China, will join the group, the Washington Post wrote.

Earlier this year, the Commerce Department issued a report alleging that the United States’ reliance on imported steel and aluminum posed a national security threat. In March, Trump used that finding to announce steep tariffs against China and Japan, temporarily offering exemptions for many other countries.

In recent weeks, Trump has met with leaders from three U.S. allies caught in the middle of the tariff debate. French President Emmanuel Macron and German Chancellor Angela Merkel appealed last week to Trump to alter his stance, yet the administration has continued to press for concessions, and there is no guarantee that they will be spared.

European leaders have threatened countermeasures if Trump goes ahead with his proposed tariffs. The European actions would target items such as motorcycles and bourbon, produced in Republican electoral strongholds.

In March, the administration set aside tariffs it had proposed on South Korean steel and aluminum manufacturers. In return, South Korea amended its U.S.-Korea Free Trade Agreement, accepting quotas that will cut its steel exports to the United States by 30 percent below the average of the past three years.